Home Buying in 90006>Question Details

Lsavona21, Home Buyer in Los Angeles, CA

After my loan was FULLY approved, I received an email telling me that it got pulled for a quality audit 4 days before closing!! Is this right? Legally

Asked by Lsavona21, Los Angeles, CA Sun Nov 25, 2012

Help the community by answering this question:


I do not know what is going on with banks!! you may want to talk to a Real Estate Lawyer.

Good luck,

Mary Suliman
1 vote Thank Flag Link Mon Dec 3, 2012
Did they tell you how long the audit would be and how it would affect closing date? Don't panic til you know the specifics.
1 vote Thank Flag Link Sun Nov 25, 2012
They asked for my 2011 W-2 again... I own my own business and make the majority of my money through commissions. My accountant had to give them more info. Hopefully it's what they need or else I'm homeless!
Flag Sun Nov 25, 2012
Hi Lsavona21,

Lending guidelines are strict for the banks. I would check with lender about process and how long it will take. Are they reviewing total loan and what are their concerns. Hopefully, it will only take a few days.

Gail Mercedes Cole
EXP Realty
0 votes Thank Flag Link Fri Oct 4, 2013
Yes it is possible that lender may have a quality review prior funding. It is best you request an extension for your closing date.
0 votes Thank Flag Link Mon Nov 26, 2012
This is absolutely part of the process these days and yes, it pretty much sucks. The real kicker is that you have a legally binding contract to buy this home by a certain date.

Have your lender call the listing agent and explain the situation. Then, ask for an extension to legally extend your time period for buying.

Best of luck.
0 votes Thank Flag Link Mon Nov 26, 2012
As commented on below, yes they can do it and unfortunately do.
0 votes Thank Flag Link Mon Nov 26, 2012
Your question as to if it is RIGHT or LEGAL? Yes. The lender has the right to revisit or place under further review or audit your loan application before funding.

Fear not if you have provided accurate information to the best of your ability and knowledge.

Best of Luck.
0 votes Thank Flag Link Mon Nov 26, 2012
Unfortunately, yes, they can make everyone upset.
0 votes Thank Flag Link Mon Nov 26, 2012
The question is what was uncovered in your QC audit??
No back up lender can fix an audit problem.
Your LO needs to give your more details!!
0 votes Thank Flag Link Sun Nov 25, 2012
A QC audit may or may not find a problem. If it does, depending on what the problem is they may solve it or a back up lender may. If there is no problem, as I've had happen when this occured to a file of mine, we proceeded to closing.
Flag Sun Nov 25, 2012
Was the loan approval in writing from the underwriting team? Even so, if they don't give you the loan, they don't give you the loan. That is why my clients have a backup lender in line, just in case of situations like this.
0 votes Thank Flag Link Sun Nov 25, 2012
If you pull a loan from a lender, will that affect your credit? Can the lender hurt your credit because you pulled your loan?
Flag Thu Nov 21, 2013
Fully approved? You had already signed loan docs and it went back for funding..then they pulled it for an audit? Anything can happen, I would advise looking into the details, may not be over yet so don't panic until you know what's happening and how long the audit will take.

Good luck!
0 votes Thank Flag Link Sun Nov 25, 2012
I'm not an attorney, but I've heard of this happening before and I'm not aware of any law against it. A loan isn't finally really approved until it's funded and closed. I've even had lenders request documentation after funding and threaten to reverse the funding. As long as they have the money you want, you are at a bank's mercy. It's not fun, fair or the way we wish it were, but it's the way it is.
0 votes Thank Flag Link Sun Nov 25, 2012
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